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Case Studies

Longtime client Magellan Health Services Inc. (“Magellan”) has, once again, looked to Epstein Becker Green litigators for assistance—this time, in an attempt to deflect a significant challenge to a subsidiary’s credentialing program for the reimbursement of diagnostic imaging services.

In an action filed in New Jersey state court against Magellan and its subsidiary, National Imaging Associates, the New Jersey Podiatric Society asserted claims for violations of New Jersey’s unfair insurance claims practices act and unlawful discrimination against the podiatrists in violation of New Jersey’s scope of practice statute. The society also sought preliminary injunctive relief, posing a direct threat to our client’s business operations. If granted, the injunction would have restricted Magellan’s ability during the pendency of the litigation to dictate the necessary qualifications for network providers seeking reimbursement for diagnostic imaging services.

The court denied plaintiff’s application for a preliminary injunction and adopted Epstein Becker Green’s position that plaintiff’s discovery demands should be scaled back substantially. The court ordered discovery to be completed within 60 days and directed that discovery be limited solely to confirming facts that had been already presented by affidavit. After such discovery, on September 19, 2014, the court granted summary judgment in Magellan’s favor.

Epstein Becker Green’s civil action on behalf of a medical school client led to a temporary restraining order (TRO) and, later, a preliminary injunction issued against a disgruntled former student. That former student set up websites with infringing domain names that would emerge in standard Internet search engines and divert those seeking actual client websites to land on the former student’s webpages filled with vitriolic anti-client rhetoric; statements disparaging the client, its educational services and its officers; and factually false information concerning the client, its graduation rates, and certain financial matters.

The facts and legal arguments developed by Epstein Becker Green led to the court enjoining such conduct and disabling the websites, which occurred in less than 12 hours from the issuance of the first order. The court found a likelihood of success on the merits on the contract claims, trademark infringement claims, and cybersquatting claims, concluding that the client had demonstrated defendant’s “bad faith” under Title 15 of the United States Code and rejecting the former student’s claims of non-commercial speech entitled to protection.

In early 2014, federal Judge Anne E. Thompson, sitting in New Jersey, found that the rogue former student had breached his non-disparagement obligations under a prior settlement agreement and had wrongfully infringed upon our client’s trademark rights in violation of the federal Anticybersquatting Act. Judge Thompson permanently enjoined defendant and all those acting in concert with him, including all Internet registrars and hosting entities, from publishing or disseminating any statements intended to disparage the medical school and its administrators.

Epstein Becker Green recently achieved a significant appellate victory for Horizon Healthcare Services Inc. ("Horizon") and Magellan Health Services Inc. ("Magellan"). On June 11, 2013, the Superior Court of New Jersey, Appellate Division, reversed a decision by the Chancery Division, Essex County, and dismissed a lawsuit brought by the New Jersey Psychological Association ("NJPA") and two patients. The complaint alleged that Horizon and Magellan had breached their agreement under the State Health Benefit Program ("SHBP"), which insures New Jersey workers, and violated the New Jersey Practicing Psychology Licensing Act ("PPLA") by requiring psychologists to disclose confidential patient treatment information before paying for the patients' mental health services.

The NJPA previously sued Horizon and Magellan in the Chancery Division, Mercer County, for violating the SHBP agreement and the PPLA. In January 2011, the Mercer judge dismissed the suit, claiming that the NJPA lacked standing to bring its claims against Horizon and Magellan because it couldn't prove that the association had suffered any harm. The NJPA filed an appeal, but then withdrew it. In July 2011, the NJPA and two patients, who were covered under SHBP plans and claimed that they were denied treatment by Horizon and Magellan because they refused to disclose confidential information, filed a second lawsuit, but, this time, in the Chancery Division, Essex County. The Essex judge declined to dismiss the suit, and Horizon and Magellan appealed.

In its decision, the Appellate Division pointed out that the plaintiffs in the Essex County suit "raise no new issues and present no new material facts that should change the decision made by the Mercer judge." Accordingly, the Appellate Division dismissed the suit, adding that the Essex judge should not have not considered the case and that the two patient-plaintiffs were required to exhaust their administrative remedies under the SHBP before seeking judicial action.

EBG, BD Collaborate in Trade Secret Enforcement

Epstein Becker Green's timely filed civil action on behalf of Becton, Dickinson & Company ("BD") led to a May 31, 2013, restraining order against Ketankumar Maniar, a former BD employee planning to leave the country in days with BD trade secrets in his possession. The facts developed by BD and EBG, along with the civil court filings, were provided to federal law enforcement officials. Realizing that the material Maniar had taken amounted to a "tool kit" for manufacturing a soon-to-be-released disposable pre-filled pen injector in which BD had invested substantial time and money, federal agents opened an investigation. They later executed a search warrant to retrieve from Maniar a number of storage devices and, on June 5, 2013, arrested him for criminal violation of 18 U.S.C. Section 1832. The arrest was widely reported locally, nationally, and internationally after it was announced by the U.S. Attorney for District of New Jersey and the FBI. Later, EBG attorneys obtained a permanent injunction in the civil matter, and Maniar was convicted, sentenced, imprisoned, and deported on criminal charges concerning his crimes against BD as well as on an additional count concerning a former employer, which was uncovered as a direct result of EBG’s investigation. The conviction was also widely reported.

On January 31, 2011, Epstein Becker Green obtained a dismissal of a case brought by two plaintiffs—a state psychological association and an individual psychologist—seeking broad limitations, through the application of the patient-psychologist privilege, on the information that a health benefits plan could seek from or concerning insureds to establish the medical necessity of initial or continued mental health treatment. The New Jersey court found that neither plaintiff had a direct injury or associational or third-party standing and questions of privilege needed to be determined in the sort of case-by-case approach that precluded the granting of broad, general relief against the health benefits plan or those providing administrative or utilization management review services to the plan.

The Epstein Becker Green team representing those providing administrative or utilization management review services to the plan included New Jersey Litigation attorney James P. Flynn.

Epstein Becker Green Advises on First-Ever Affiliation Between Hospital Systems in Philadelphia and New Jersey

Epstein Becker Green advised Kennedy Health System, an integrated health care delivery system serving the residents of Camden, Burlington, and Gloucester counties in southern New Jersey, in connection with an affiliation transaction with Thomas Jefferson University (branded as “Jefferson Health”), a regional health system that recently also acquired Abington Health System, Aria Health, and Philadelphia University. This partnership builds on Jefferson Health’s innovative “hub and hub” model, whereby Kennedy Health will serve as the southern New Jersey hub of Jefferson Health. The affiliation, which took almost two years to complete, will bring enhanced clinical services to South Jersey residents, who will not only be able to receive care from the same trusted physicians, nurses, and staff, but also have access to advanced clinical services and promising clinical trials available at Jefferson Health.

This affiliation marks the first time that a Philadelphia and New Jersey hospital system joined together. Officials said that they hope the affiliation will bring better, more convenient health care services to patients in both areas.